How Demand Response and Flexibility Can Support Decarbonisation

Ireland’s Decarbonisation Challenge

The electric power system in Ireland is undergoing an unprecedented transformation. The generation mix is increasingly integrating non-synchronous, variable renewable energy sources, which are weather-dependent and inherently less predictable or controllable than conventional generation. In 2020, wind power supplied 36.3% of Ireland’s electricity, and at times the power system operated with up to 75% of power coming from variable renewable generation. We are also moving away from a linear ‘one-way’ flow of electricity from centralised, large generators to passive consumers, towards a ‘two-way’ system where generation and storage is increasingly distributed and embedded deep into the network.

As the system transforms, flexibility across the grid will need to dramatically improve in order to continue to deliver a safe and reliable service to all consumers. Fundamentally, large-scale activation of flexibility on the demand side is essential if we are to meet the challenging targets of up to 80% renewable energy share in electricity (RES-E) by 2030. This becomes even more complex when we consider the increasing electrification of heat and transport that is driven by policy to advance the decarbonisation of these sectors.

Flexibility services provide the electricity system with a cost-effective solution to address the challenges associated with transition for an increasingly decarbonised future power system with higher levels of distributed generation and demand. Looking forward, as the power system becomes increasingly dominated by variable renewables, network flexibility will need to dramatically improve in order to continue to deliver a reliable service to all consumers. Without increased flexibility the result will likely be higher costs to the end consumer, resulting from increased energy market volatility and more expensive network reinforcement requirements.

Benefits of Demand-Side Flexibility

Demand-side flexibility holds the potential to contribute significantly towards meeting the needs of Ireland’s future power system. Key benefits of demand-side flexibility include:

Delivery of services from no-load state

Demand-side flexibility delivers valuable energy and system services from a no-load state. This avoids the considerable cost and carbon emissions associated with scheduling thermal plant to operate at their minimum stable generation thresholds, where they perform at their lowest thermal efficiency, in order to provide services, for example reserve, needed to support zero carbon generation on the system.

Load-following availability of resources

Increasing the volume of non-synchronous renewable generation results in a corresponding reduction in the availability of essential grid services. This is due to the corresponding reduction in volume of conventional generation, which includes inherent characteristics that have traditionally provided these services. In contrast, the availability of demand-side flexibility remains broadly proportional to the total energy consumption on the power system, matching availability and expenditure with the time-of-need on the system.

Reduced life-cycle carbon emissions

The provision of demand-side flexibility is supplementary to the primary activities of the individual demand sites that provide it. It is provided using equipment and processes that already exist and, as such, the build phase of their life-cycle carbon emissions will have been amortised and are not related to their availability to provide flexibility services.

Positive promotion of consumer engagement

Engagement in providing demand-side flexibility services fosters awareness of the power system and provides participating consumers with a source of revenue that can be further invested in energy efficiency measures. The evolution of the demand response and aggregation business model will enable aggregators to engage increasingly smaller customers, broadening consumer engagement in ‘good energy citizenship’.

How can policy and regulation support demand side flexibility?

National policy needs to put the customer, in their homes, communities, and businesses, at the centre and ensure that customers can play a more active part in supporting the electricity system of the future. Currently this is easier with large users such as industry and commercial sites – in the future, as we further electrify transport and heating, those sources will also be able to offer flexible demand to the power system.

Energy market rules need to facilitate more demand flexibility, more efficient storage and other technologies – the future power system will need a broad range of technologies and sources to help support higher levels of renewables generating electricity. Traditional, large conventional generators will still be needed, but less frequently. Flexible demand provides a means of dealing with variation that helps the power system to stay in balance, and can help avoid expensive capital investment in network assets.

As Ireland increases the amount of renewable generation in order to meet our decarbonisation targets, it is clear the power system will face new technical challenges. Demand response is capable of providing flexible services to help manage intermittent generation such as wind, relieve congestion on electricity networks, and help balance supply and demand when capacity margins are tight. Fully exploiting the potential for demand response and flexibility among customers will be essential.

Sources

  https://windenergyireland.com/latest-news/5364-annual-report-confirms-wi...

  https://www.eirgridgroup.com/newsroom/electricity-consumption-f/

  https://www.gov.ie/en/publication/6223e-climate-action-plan-2021/